Council Company Could Cut Energy Bills for Residents

READING residents could soon be benefitting from cheaper energy bills under Council plans to join with other local authorities in supplying gas and electricity directly to local homes.

As energy bills continue to soar, it is estimated that 14% of Reading households are struggling to pay to heat their homes.

Reading Borough Council is now considering joining Southampton City Council’s (SCC) proposed scheme to establish a ‘white label’ energy company to sell cheaper gas and electricity directly to residents living in the Berkshire, Hampshire and Oxfordshire regions. The innovative scheme could cut residents’ bills by up to £200 a year.

There are currently 54 energy suppliers in the UK, of which the ‘big six’ supply 83% of customers, and other companies 17%.  With the energy market starting to diversify, local authorities are getting involved in energy supply.  The first Council-owned company in the UK was Robin Hood Energy, established by Nottingham in 2015. This was recently followed by Bristol Energy.

Reading is now one of a number local authorities in discussions with APSE Energy and Southampton City Council. A joint approach would allow Councils to gain enough of a market share to enable a reliable, good value local energy tariff to be offered to local residents.

Establishing a joint Local Authority energy company could reduce the cost of energy for residents living in the local authority areas by between £100 and £200 every year. It could also create an additional income for the Council, depending on the number of customers attracted in the area, as well as creating jobs and further reducing carbon footprints locally through future investment in low carbon projects.

A meeting of the Council’s Strategic Environment, Planning and Transport Committee next week (Nov 22) will hear about the opportunities of the new local authority energy company in more detail. The full report can be found at:  http://www.reading.gov.uk/media/7969/Item14-Report-Energy-Company-3/pdf/Item14_Report_Energy_Company_(3).pdf

Tony Page
Cllr Tony Page

Councillor Tony Page, Reading Borough Council’s Lead Member for Strategic Environment, Planning and Transport, said:

“Gas and electricity bills continue to rise and fuel poverty continues to be a very real issue for low income homes in Reading. It is also hard to see anything changing with the monopoly of the ‘Big Six’ energy firms.

“The Council has been talking to Southampton City Council about the potential benefits of this innovative new scheme, not least the fact that it could help cut energy bills for residents in Reading by between £100 and £200 every year.

“In the longer term it could also help provide an additional income stream for the local Councils involved.”

The meeting of the Council’s SEPT Committee on November 22nd will be asked to delegate authority to officers so that Reading can join the scheme.

Earlier this year Southampton City Council agreed to push ahead with plans to establish of a regionally branded ‘white label’ contract with a licensed energy supply company and to discuss potential partnerships with other local authority areas. Southampton would manage the new company on behalf of partnering Councils.

Under current timescales, a formal contract could be drawn up as early as February 2018, prior to the scheme going live in Spring/Summer 2018.

Notes To Editor

  • The average home in the UK spends £1,142 per annum on energy (June 17 figures) with the average  business  spending £4,500.
  • The three Counties offer a potential market of over 1 million homes and 200,000 businesses, providing a market conservatively estimated at £1.5bn gross for electricity and gas sales.

Oscar Mortali

For media enquiries about this release email oscar.mortali@reading.gov.uk or call 0118 937 2301